How 9/11 revealed the dark side of corporate charity
Or W12 platform as a solution to the main problem of charity
The terrorist attacks on 11 September 2001 brought the greatest rush of donations in the history of USA but the image of charities had been tarnished by their opaqueness, unaccountable and controversy over how collected funds had been spent. Then, mistrust was born as the main and eternal problem of charity!
Charity figures for 9/11 are impressive: at least $2.3bn of public donations to 30 already existing charities and new smaller funds, from the Salvation Army to the Twin Towers Fund. 65% of American’s contributed, many of them for the first time.
In the epicenter of this stood the American Red Cross, which alone raised $988.8m and faced millions of questions over its integrity. To begin with, the organization fundraised way beyond its own $300m goal. Than its president Bernadine Healy without explanation diverted donations from the existing disaster fund into the new one. Than it emerged that Healy had grandiose plans to invest sizeable sums in Red Cross infrastructure. Only political pressure forced him to spend 90% to 9/11 victims. Other nonprofits weren’t better and didn’t communicate with their donors as well.
Also, inequalities of assistance had been shocking. Huge payouts were transferred to emergency services and families of public sector workers. But thousands of low-paid staff in New York — including immigrants — got only a minor part of donations. The cause was that small charity organizations that wanted to help these victims simply could not reach the donors. Their call was heard by a limited number of people.
Let’s not forget about frauds. With the illnesses of thousands of firefighters and police officers after 9/11, many charity scammers were parasitizing upon public servants as donors weren’t proactive by visiting the police or fire department and inquiring whether there is such official fund and whether it is benefiting the right people.
The reputation of nonprofits in the US had been damaged. Many people had a loss of faith in charity. In a poll for the Chronicle of Philanthropy, 42% of Americans said they had less confidence in charities because of how they handled 9/11, and 29% said they would be less likely to contribute to any charity because of how disaster donations were handled. The reasons they mentioned: a huge number of scammers, untransparent of nonprofits, waste, duplication, and misuse of funds, and the time charities had taken to assess needs and distribute the money.
The seeds of mistrust sowed by the September 11 tragedy seemed to be irreparable until the advent of blockchain. With the use of this technology, the W12 team has developed a fully transparent and fraud-resistant platform, on which backers & donors directly control the fundraisers. It consists of three main components:
● Smart contract concluded by the parties. It accepts donations from donors (credit cards, electronic money, cryptocurrency, SMS, etc.) and transfers tokens instead. Its functions also include depositing collected funds, ensuring control over the implementation of the stages of the roadmap, transferring installments for performing another milestone, returning the unspent funds if the project failed or was fraudulent.
● Three mechanisms for deciding whether or not roadmap milestone has been reached: 1) every donor determines it by himself. 2) 12 oracles pass the verdict. 3) a majority vote sets the verdict.
● Public distributed ledger where all participants can track the movement of funds. Receipts, checks, contracts and other documents are also loaded here.
As we see, the problem of distrust does not exist at all on W12. The scenario that occurred after 9/11 would have been impossible. Each donor or supervisory official could track where each cent of donations went. At the same time on our platform will always be heard all worthy projects, even the smallest. Read more about our marketing opportunities here.
